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Zagame family lists $300m hotel portfolio

People & Companies / Latest News

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Melbourne based hotels dynasty, the Zagame family, has put its hotel portfolio of six properties located in Melbourne and Vanuatu to market with price expectations of more than $300 million.

The portfolio will be offered on an individual basis, in any combination or in-one-line and is expected to generate significant interest locally and internationally.

National Director CBRE Australia, Mark Wizel, whose team has been appointed with Cropley Commercial to manage the marketing campaign, said the Zagame family had been industry innovators establishing one of Australia’s most successful and respected operators.

``Victor Zagame was an innovator and leader of the Australian hotel and hospitality industry with a product that immediately captured a loyal clientele at The Albion Charles Hotel more than 46 years ago (1971) for what became the Zagame Corporation – one of the Australian hotel and service industry’s most respected and well-known businesses.

``The successful purchaser or purchasers will have the significant advantage of buying into that success story,’’ Mr Wizel said.

The gaming-centric portfolio comprises five Victorian freehold going-concern hotels, generating combined revenues in excess of $94 million, with current ownership of 490 gaming machine entitlements representing an opportunity to enter the lucrative Victorian gaming sector with one of the largest gaming machine holdings and market share.

Also included in the sale is Vanuatu’s premier hotel and casino - the 4-star Grand Hotel & Casino, offering a casino, VIP room and 74 luxury accommodation rooms. Situated 10km from the airport and Port Vila’s business and entertainment precinct, the eight-level waterfront hotel offers a variety of income streams generated from its 16 table games, 136 gaming machines, accommodation and food and beverage facilities.

Zagame Corporation Director, Victor Zagame Jnr, said the incoming purchaser would be buying a proven business model that had grown successfully over 50 years.

``Our venues are exceptionally well presented, our staff are leaders in the industry, and our product is second to none. These successful businesses are well placed to continue to deliver substantial growth,” Mr Zagame said.

Cropley Commercial’s George Iliopulos, said the portfolio comprised the single largest gaming portfolio to ever hit the market in Victoria, a portfolio poised for strong trading growth.

``The State Government’s decision to extend gaming licenses until 2042 has provided operators with certainty and has made Victoria’s 13,750 pub gaming entitlements that much more sought after and valuable in Australia’s fastest growing state,” Mr Iliopulos said.

He said further underpinning the value of the portfolio was the Government’s recent announcement to freeze the number of poker machine numbers for the next 20 years and increasing the current machine ownership terms from 10 years to 20 years, essentially providing an incoming purchaser with 24 years absolute certainty around the existing 490 gaming machine entitlements.

Mr Wizel said all hotels within the portfolio were strategically located on large landholdings within central suburban locations.

``These sites offer future mixed-use development options adding significantly to the potential upside available within a portfolio of quality and scale that very rarely comes to market.

``We are very confident of attracting a high level of interest from international buyers, particularly from Asia and North America,’’ Mr Wizel said.

He said Melbourne remained very much on the investment radar from a global perspective, given the economic and political stability and the consistent high levels of population growth.

International Expressions of Interest close at 5pm on Thursday, 21 June.

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